New Delhi, Jan 2 (PTI) India’s manufacturing activity recorded its slowest expansion in two years in December due to softer growth in new orders, leading companies to curb input purchases and job creation, according to the latest monthly survey.
The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) fell from 56.6 in November to 55 in December. A PMI above 50 indicates expansion, while below 50 signals contraction.
“Even with growth momentum easing, India’s manufacturing industry wrapped up 2025 in good shape. The sharp rise in new business intakes should keep companies busy as we head into the final fiscal quarter, and the lack of major inflationary pressures could continue to support demand,” said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence.
The survey highlighted slower production growth, the weakest upturn in new orders in two years, and a softer rise in international orders—the least in 14 months—mainly from Asia, Europe, and the Middle East.
Softer new business led firms to limit input purchases, and factory employment rose only marginally—the slowest pace since the growth period began in March 2024. Input costs rose at a historically negligible rate, while charge inflation eased to a nine-month low.
Looking ahead, Indian manufacturers expect output growth in 2026, but overall sentiment fell to its lowest in nearly three-and-a-half years. While advertising, demand trends, and new product launches are seen as positives, firms expressed concerns over competitive pressures and market uncertainty.
“With Indian manufacturers facing less intense cost pressures than elsewhere, many will be hoping that competitive pricing can help bring in new business from other regions in the new year,” Lima added.
The HSBC India Manufacturing PMI is compiled from responses by around 400 purchasing managers.
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